A Step-By-Step Overview of the Arbitration Process

As we have discussed in a previous blog, there are a number of pros and cons to utilizing arbitration as a means of resolving a construction-related dispute. In many circumstances, this type of Alternative Dispute Resolution (ADR) can be a highly effective means of achieving an efficient and effective resolution which is beneficial for all parties involved.

But how exactly does arbitration work? It is always useful to have a clear understanding of how the process will play out prior to invoking an Arbitration Agreement or suggesting arbitration as a potential option to an opposing party. Thus, we have provided a brief, step-by-step overview of what you can expect. Please be aware that this is just a simplified outline, and is not necessarily precisely how your unique case will play out. The terms detailed in an arbitration agreement may serve to modify the procedure followed.

Step 1 – Set the stage

In Florida, even if there is no arbitration agreement in place that legally necessitates the use of arbitration to resolve a dispute, the parties involved in a dispute can voluntarily agree to participate in binding arbitration.

Once it is established, either voluntarily or through contractual obligation, that arbitration is to be utilized, the parties may need to agree to certain aspects of procedure. For example, they may choose to utilize a single neutral arbitrator or a tribunal of arbitrators. They may decide to adhere to the standard American Arbitration Association rules of procedure, or they may choose to customize the procedure and rules to suit their unique dispute and circumstances.

Once all procedural elements are defined and agreed upon, the case can proceed to arbitrator selection.

Step 2 – Arbitrator selection

One of the key benefits of arbitration is the ability to select a neutral arbitrator who is knowledgeable about the subject matter at hand in your dispute. In a litigated case, there is no guarantee your judge will have a solid understanding of the unique nuances and issues inherent in construction. With arbitration, you can select someone who specializes in the area to help ensure a fair judgment. Generally speaking, arbitrators will be selected from a pre-approved list of neutral candidates. Once they are selected, a preliminary hearing will be held to finalize the procedural elements of the case and facilitate what can and cannot be included in the arbitration hearing (witnesses, evidence, etc).

Additionally, there may or may not be a discovery period prior to the hearing where all parties involved will be required to share their evidence and other information with opposing parties. The extent and rules of the discovery period will likely depend on your arbitration agreement or the terms you settled upon when you voluntarily agreed to arbitrate.

Step 3 – The hearing

Arbitration hearings are much less formal than litigation hearings, meaning their location and scheduling are much more flexible. Not unlike a trial, however, each party will have opportunities to present their case to the arbitrator(s). They may call witness to offer testimony and present whatever evidence they may have. Conversely, the opposing parties will be able to question and challenge the witnesses and evidence presented.

Once the hearing is complete, the arbitrator(s) will retire in order to deliberate. In some cases, attorneys for either party may be allowed to submit post-hearing documentation to further support their case or challenge actions taken by the opposing party.

Step 4 – The award

Finally, the arbitrator(s) will issue a decision and dictate an award. Unlike mediation, the decision will be considered binding with very limited recourse for any sort of appeal. The parties will be required by law to adhere to the terms of the arbitrators’ decision, since Florida courts recognize a presumption of enforcement of arbitration. The courts will, however, review the case to ensure there was no fraud or misconduct at play.

If you are involved in a construction dispute, and you are either legally bound to utilize arbitration or you wish to voluntarily pursue this option, please do not hesitate to contact the Florida Construction Law Group today and let us fight to protect your best interests.